**Brazilian Senate Considers New Taxes on Sports Betting and Online Gaming**
The Brazilian Senate is contemplating introducing new criteria for “selective taxes” that could impact the sports betting and online gaming sectors. This development is part of a report by Senator Eduardo Braga, who acts as the Rapporteur for the Senate’s ongoing federal tax reform efforts.
According to SBC Notícias Brazil, Braga classifies sports betting, online games, and fantasy sports within the category of products and services that are considered harmful to health or generate negative externalities, akin to alcohol, tobacco, and fossil fuels. This proposed tax is meant to encompass these rapidly growing sectors.
The introduction of taxation is contentious as Brazil prepares to launch its regulated fixed-odds betting and online gambling market in 2025. Initiated in December 2023, the current tax framework, outlined in [Law No. 14,790/2023](https://www.planalto.gov.br/ccivil_03/_ato2023-2026/2023/lei/l14790.htm), imposes a 12% income tax on gross gaming revenues for licensed operators, alongside a [15% personal income tax](https://sbcnews.co.uk/featurednews/2024/05/09/brazil-commits-to-15-player-prize-tax/) on prizes exceeding BRL 2,824 (€530), backed by President Lula da Silva.
Despite its approval, further scrutiny lies ahead. A Constitutional Amendment Proposal (PEC) is in motion to determine the relevance of selective taxes specifically for betting activities. The Brazilian Senate will vote on this matter on December 11, and “sin taxes” debates will persist into 2025 through a Complementary Bill.
**ANJL’s Perspective on Proposed Taxes**
The National Association of Gaming and Lotteries (ANJL) has expressed concern that excessive taxation might drive consumers toward illegal markets, potentially undermining federal regulatory mechanisms helmed by the Prizes and Betting Secretariat (SPA).
Dr. Ana Helena Pamplona of ANJL emphasized that tax policies should optimize efficiency rather than expanding tax burdens. She criticized additional taxation on online betting and fantasy sports, beyond the rates set by Law No. 14,790, as contrary to core tax principles and spurred more by political motives than technical rationale. Pamplona warned this could burden the market, pushing players to illicit avenues, thus compromising state oversight.
**Impact on Fantasy Sports**
The application of “sin taxes” also jeopardizes certain sectors, notably fantasy sports, due to their relatively low addiction potential. Bárbara Teles, a lawyer and ABFS director, highlighted the surprise following the non-acceptance of an exemption request, noting that taxing fantasy sports is unfair as these operations are fully digital, with no environmental ramifications. Excessive taxation, she argues, may stunt innovation and expansion in this emerging industry.
**Outlook and Debate**
Critics suggest that the proposed taxes appear driven by political motives rather than economic soundness. The ambiguity and volatility in tax calculations could threaten market sustainability and hinder its potential growth.
Supporters advocate for balanced policies that spur sector growth, technological progress, and responsible entertainment, rather than punitive measures. Policymakers are urged to foster a sustainable environment benefiting all involved parties, striking a crucial balance to support growth within betting, gaming, and fantasy sports, while ensuring appropriate regulation and oversight.